New Zealand Prime Minister Jacinda Ardern will meet with Chinese Prime Minister Li Keqiang at the Great Hall of the People in Beijing, China on April 1, 2019.
Nohiko Hatta | Pool | Kyodo News | Getty Images
China and New Zealand on Tuesday signed an agreement to upgrade their existing free trade agreement, which would increase exports of goods from the Pacific nation to the world’s second-largest economy.
New Zealand Prime Minister Jacinda Ardern confirmed the signing of the agreement at a news conference on Tuesday, noting the importance of the deal between an epidemic and the global economic crisis.
The treaty has been discussed for years and was concluded in November 2019, but China’s official signature was pending.
New Zealand Trade Minister Damien O’Connor signed the Advanced Agreement in Wellington through a “virtual signing ceremony” with Chinese Commerce Minister Wang Wentao held in Beijing.
New Zealand said the agreement “modernizes” the existing free trade agreement with China and ensures that it remains fit for purpose for another decade.
This makes it easier to export to China and is expected to reduce compliance costs for New Zealand exports by millions of dollars each year.
O’Connor said in a statement that the upgrade would also mean tariff-free access to 99% of New Zealand’s wood and paper trade of approximately NZ $ 3 billion ($ 2.16 billion).
The deal will benefit New Zealand exporters of seafood, forestry sector and other priority sector industries.
Existing conditions have been maintained for dairy products, with the elimination of all safety fees within one year for most products and within three years for milk powder.
“This means that by 1 January 2024, all New Zealand dairy exports to China will be duty free,” O’Connor said.
New Zealand was the first developed country to sign a free trade agreement with China in 2008, long seen by Beijing as an earlier example with Western countries.
China is now New Zealand’s largest trading partner, with annual two-way trade exceeding NZ $ 32 billion ($ 21.58 billion).
But relations under Ardern’s government were tested as New Zealand criticized China’s influence on the small Pacific islands and raised human rights concerns about Muslim Uigars in Xinjiang. Aderan supported Taiwan’s participation in the World Health Organization (WHO) despite warnings from Beijing.
The trade deal with New Zealand also comes after the worsening of Beijing’s relations with neighboring country Australia as Canberra called for an independent investigation into the origins of the coronovirus epidemic, first reported in Central China.
Australia has appealed to the World Trade Organization to review China’s decision to impose heavy duty on Australian barley imports.
New Zealand, which will host the regional Asia Pacific Economic Cooperation Summit this year, has said it will be ready to help negotiate a deal between China and Australia.